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Ethnically diverse neighbourhoods are generally less cohesive. A negative relationship between neighbourhood diversity and social cohesion is, however, neither a necessary nor a sufficient condition to conclude that neighbourhood diversity erodes intra-neighbourhood cohesion. This contribution shows - by using data collected during the second wave of the NEtherlands Longitudinal Lifecourse Study (NELLS) - that: (1) members of ethnic minority groups are more likely to report having contact with and trust their immediate neighbours than natives (ego ethnicity effect); (2) minority group residents are less likely to be contacted and trusted by their neighbours (alter ethnicity effect) and (3) all ethnic groups prefer to mix with coethnics (dyad ethnicity effect). Once we control for these three ethnic composition effects at the ego, alter and dyad-level, neighbourhood ethnic diversity is no longer related to less contact between neighbours. Previously identified negative relationships between neighbourhood diversity and cohesion should therefore be re-evaluated, as they may be the consequence of ethnic composition effects instead of a true neighbourhood diversity effect.